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Net-a-Porter: Natalie Massenet sells luxury fashion website via [wsj]

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Richemont to Buy Net-a-Porter

[PORTER] Net-a-Porter.com

In addition to selling luxury clothing,

Net-a-Porter has established itself as an online fashion magazine.

Swiss luxury goods maker Compagnie Financière Richemont SA on

Thursday announced a deal to buy U.K.-based online luxury retailer Net-a-Porter

Ltd., a transaction that signals the increasing importance high-end

consumer goods companies are assigning to online sales.

Richemont, the owner of brands such as Cartier, Montblanc and Chloe,

previously held a 33% stake in closely held Net-a-Porter, but agreed

to acquire a majority of the company from a group of private

shareholders for up to £225 million ($341 million). Richemont said the

transaction values the overall company at £350 million.

Net-a-Porter, founded in 2000 by former fashion journalist Natalie

Massenet, has been a forerunner in selling expensive designer women’s

clothes and accessories online. That is a space that was long

overlooked by big luxury goods houses like Richemont, Burberry PLC and

LVMH Moët Hennessy Louis Vuitton SA , which jumped on the online sales

bandwagon far later than their lower-priced counterparts did.


Former fashion journalist Natalie Massenet

founded the site in 2000.

Lately, however, the big luxury brands have made digital retailing a

higher priority, having recognized that shoppers are increasingly

willing to buy very expensive products on the Web. But selling $1,000

dresses online is different from hawking groceries or second-hand

books: Customers want an editorial element, a guiding hand to replace

the in-store salesperson and signal what’s in style, which is where

Net-a-Porter has carved out its niche.

The Web site, which says it has been profitable since 2004 and

reported sales of about £120 million for the fiscal year ended Jan. 31,

has established itself as an interactive shopping fashion magazine,

publishing 52 weeks of editorial content each year alongside its

designer clothes sales operation.

“It’s just as much a magazine as it is a store,” said Ms. Massenet

in an interview. “That really has served us well, because when you’re

online you lose the offline experience of walking into a store.”

Net-a-Porter plans to expand its operation in the U.S. as the market

for luxury online retailing heats up. The company currently operates a

50,000 square foot distribution center in New York’s Long Island City,

which handles about 30% of the company’s business. CEO Mark Sebba says

Net-a-Porter intends to more than double the U.S. operation’s capacity

in the coming year and open a new distribution center in Southeast


The deal with Richemont takes away Net-a-Porter’s independence, and

some retailers selling their goods through the luxury Web vendor could

be upset that it is now owned by a competing company. But Ms. Massenet

says Richemont lets its divisions operate independently and

Net-a-Porter’s suppliers have never had a problem with the Geneva-based

company being a shareholder. Richemont first invested in Net-a-Porter

in 2002.

Natalie Massenet

Democratic: The

website has made designer fashion easily accessible to women around the


A year ago, Net-a-Porter launched a sister site, theOutnet.com,

which offers discounted designer clothes. The move indicated the newest

frontier in online luxury shopping: discount Web sites, some of which

operate flash sales of high-end merchandise. EBay Inc., Gilt Groupe Inc.

and GSI Commerce Inc.’s Rue La La have entered the online discount

luxury sector too.

Ms. Massenet held an undisclosed stake in the company she founded,

and will stay on as executive chairman.

Write to Paul Sonne at paul.sonne@wsj.com


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